NEW YORK: Dollar Tree may adjust product offerings or raise prices as President Trump’s tariff plans affect imported goods.
During an earnings call, the retailer stated it might change product sizes or remove items if tariffs increase costs.
Dollar Tree’s interim CEO Michael Creedon mentioned that the company is considering various strategies to manage tariff impacts.
Trump has threatened 25% tariffs on goods from Mexico and Canada, and 10% on imports from China.
With 40% of its sales tied to imports, Store is vulnerable to these tariff increases, according to analysts.
The company plans to negotiate with suppliers and possibly shift sourcing to avoid higher tariffs, following past strategies.
Store may raise prices from $1.25 to counter tariffs, following similar moves by chains like Walmart and Best Buy.
In 2021, Dollar Tree increased prices to $1.25 after maintaining a $1 price for 30 years.
This “multi-price” strategy allows Dollar Tree to adjust prices if tariffs raise product costs.
Analysts predict Dollar Tree might increase prices by 10-20 cents to mitigate the tariff impact, according to UBS.
The company has already been struggling with a decline in sales and leadership change, with stocks dropping over 40% this year.
Higher prices have impacted Dollar Tree’s core customer base, leading to reduced purchases of home goods and knickknacks.